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Feb 23, 2011
Case Study

Government Regulation as Marketing Catalyst: B2B marketer derives 27% lead gen rate for upsells from current install base

SUMMARY: Government regulations and industry compliance can pose challenges for many B2B marketers. However, activities by governments and regulatory bodies can also provide opportunities for B2B marketers to capitalize upon.

Read how one healthcare technology company used the Stimulus Plan of 2008 and Healthcare Reform to institute a Customer Appreciation Program that solidified its ties to long-standing legacy customers and helped it enter a new business area in the form of Electronic Health Records.
by David Kirkpatrick, Reporter

CHALLENGE

Any B2B marketer working in an industry that faces government regulatory or compliance issues has a certain amount of hurdles to overcome. But at the same time those issues provide opportunities to be exploited.

When the American Reinvestment and Recovery Act of 2008 (ARRA), also known as the Stimulus Plan, was passed, Sage Healthcare saw a chance to build on its solid client base. Add healthcare reform to the mix and the entire healthcare industry is in the midst of its most rapid changes to date. This government activity creates a certain amount of uncertainty, but it also creates business opportunity.

Sage Healthcare provides technology to physician practices to manage both clinical and financial information, and up until the last several years health information technology was about practice management and the financial aspects of billing and reimbursement. The advent of Electronic Health Records (EHR), and government-provided incentives for physicians to adopt EHR, has given Sage Healthcare an entirely new line of business to pursue.

We spoke with Tony Ryzinski, Senior Vice President, Marketing, Sage Healthcare, about how he approached this opportunity and added a clinical practice piece to doctors who were already using Sage technology for their financial processing.

CAMPAIGN

Step #1. Look for the opportunity (and competitive threat) in new regulations

Through ARRA the United States government is providing strong financial incentives for physician practices to adopt Electronic Health Records. Currently, EHR is not mandated, but doctors are being offered a significant incentive to go ahead and make the change in their clinical practice.

Ryzinski realized two things:
o This opened a brand new market in healthcare technology where many players were going to get into the game
o Sage Healthcare needed to explain to its current customers that it could provide EHR technology along with its financial services.

He said, "It's kind of a trick in terms of marketing because you have all these secure customers on your practice management system, then suddenly you have to introduce them to this new system, which is a clinical piece."

Obviously this new business area was very attractive to Ryzinski, but overall he valued customer retention realizing that it's more efficient to keep the customers he already had over going out and finding new business partners. The solution was to create a Customer Appreciation Program.

Step #2. Understand your customer

Sage Healthcare's Customer Appreciation Program (CAP) does four things:
o Gains business intelligence about customers
o Deepens customer relationships
o Addresses product awareness
o Delivers a rewarding experience to its most loyal customers

And it does these things by:
o Communicating that Sage Healthcare understands its customer's business needs and cares about their success
o Creating additional value around the customer relationship
o Engaging with existing customers to recommit to contracts and solutions provided by Sage Healthcare

A major aspect of the CAP outreach is to listen to long-time customers and find out the goals and objectives of thousands of different physician practices. With this information Ryzinski can create solutions that meet the most pressing problems of Sage customers.

At the onset of CAP, Sage invited its customers to identify the issues that most strongly impacted their practices, and Ryzinski used this information to improve his understanding of pain points faced by Sage customers and to help target his marketing communications to meet those needs and concerns.

- Reward loyalty

Part of the initial CAP outreach was to provide a select group of loyal Sage customers with EHR technology at no charge to help address their most pressing IT challenges. This allowed the company to improve engagement with, and retention, among its legacy customers, and rewarded those loyal customers at the same time.

Step #3. Mitigate change

The CAP initiative gives physicians a number of immediate benefits:
o Additional Sage software as a "reward"
o Access to a dedicated toll-free phone number
o Assistance in "developing a path to success"
o Information about upcoming compliance requirements
o Assistance in leveraging Sage Support Online

Ryzinski understands his customers' most important role is practicing medicine and not managing technology. He said,
"Where (Sage's)competitive vendors require physicians to change their software solution to acquire EHR functionality, the Sage CAP offer is different. It gives Sage customers the choice of a full migration to the newer Sage technology with EHR, or the option of adding Sage Intergy EHR to the Sage legacy solution the customer is already using."

These options allow the customer to choose how much change to take on in their medical practice.

The CAP initiative ties together many health business issues:
o Reassures customers Sage will deliver solutions to meet their needs
o Raises awareness of Sage Intergy EHR
o Increases physician practice migration to Sage Intergy
o Helps to up- and cross-sell additional products
o Improves customer satisfaction
o Creates additional revenue opportunities
o Prepares customers for changes in regulatory compliance

Ryzinski stated, "Within the Sage Healthcare Division, customer appreciation is seen as more than just a 'program' or an 'offer,' but really as a philosophy. Additional program components will continue to be introduced during fiscal year 2011, and beyond, with the intention of helping both Sage and our customers achieve success. We believe CAP is serving as a differentiator for Sage and driving positive customer perception of the company and its products."


RESULTS


The results for this B2B marketing effort are somewhat atypical because the goal wasn't to necessarily drive new business, it was to maintain and solidify existing relationships.

With that in mind, Ryzinski said, "Success is measured largely by customers acknowledging that they are satisfied with what they have, and that they plan to stay with us."
He added, "CAP has created new and active dialog with thousands of Sage customers in the last five months."

The one measurable metric to report from this program is a 27% response rate from physicians looking for more information leading to new business.

Another result is feedback from customers who were part of the CAP initiative:
o "I am currently using the Sage Mends II (practice management) software and do not have the capability of EHR. I have 3 physicians offices and am interested in the EHR. Please contact me as soon as possible."
o "I would like a demonstration on the Sage EMR. We currently use a competitor EHR, but continue to use Medical Manager for our billing system."
o "Reviewing the MU (Meaningful Use criteria issued by the government to quality for stimulus incentives) criteria currently for four surgeon group prepared to discuss Sage options. We have been a Sage customer with support since 1990!"

Ryzinski is satisfied with the results of this marketing program and said, "What makes CAP special is that Sage is not asking customers to do anything nor expecting anything in return. It's simply a way to say, 'thank you' to those practices that have supported us for nearly 30 years.

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